Home Depot points to Q4 winners
The Home Depot this week announced fourth-quarter sales of $16 billion, a 5.9% increase over the same quarter last year. What happened? From Craig Menear's perspective, the answer involves execution, warm weather and strength in maintenance and repair categories.
"Warmer-than-expected weather encouraged customers to tackle exterior projects," said Menear, Home Depot's executive VP merchandising. A "nimble response," he said, led to double-digit comps in gutters, roofing, vinyl siding, patio furniture, fencing, exterior paint, pressure washers, exterior lighting and concrete.
The company said the growth was widespread -- all 40 top markets saw positive comps.
Menear cited the departments that outperformed the company's average comp: tools, electrical, building materials, paint, lumber, lighting, outdoor garden and flooring.
Other categories were merely described as "positive comps" -- hardware, bath, kitchen, indoor garden and plumbing. And on the negative side of the ledger was millwork, where negative comps were probably caused by an anniversary against the expiration of an energy-efficient tax credit.
"In addition to strength in seasonal products, exterior projects and interior projects, the maintenance and repair categories that make up the core of our store continued to execute well in the fourth quarter," Menear said. Light bulbs, cleaning, pipes and fittings, and caulk performed well.
On the product side, Home Depot has high expectations for a variety of products. First, an improved version of its Behr Premium Plus Ultra Interior Paint & Primer in One. (Menear said the new version will have better stain-blocking capabilities and improved adhesion.) Also, new Maytag ranges equipped with Aqualift cleaning technology, are coming into stores. So are washer and dryer laundry pairs from GE and LG. And a new line of power trimmers from Ryobi will be offered. The latter was described as combining "gas like" performance with a quick-charge platform.
And another good sign for home spending: Transactions for tickets more than $900 were up 3.0% in the fourth quarter, he said.